Rouble pressured by stronger dollar before S&P move on Russia

MOSCOW: The Russian rouble weakened on Friday as the US dollar pared earlier losses triggered by expectations the United States would soon cut interest rates.

At 1045 GMT, the rouble was down 0.3% against the dollar at 63.0 and was flat at 70.80 versus the euro .

Investors were watching Standard & Poor's decision on Russia's credit rating due later in the day. It currently rates Russia at "BBB-" with a "stable" outlook. Analysts at GK Region said in a note that S&P may raise Russia's outlook to "positive", while keeping the rating unchanged.

Market players are also reluctant to take new positions before central bank meetings in the United States and Russia that later this month.

Nordea Bank analysts said they expected the rouble to remain in a range of 62.5 to 63.5 to the dollar, at least until the outcome of the US Fed meeting on July 31, at which it is widely expected to cut rates.

The market sees a 56.5% probability of a 25-basis-point cut and a 43.5% probability of a 50-basis-point cut.

Fed Vice Chair Richard Clarida said on Thursday that US policymakers might need to act early to stimulate the US economy.

The benchmark price for oil, Russia's key export, hit a one-month low late on Thursday amid a sell-off on the US stock market, but pared losses on Friday.

Brent crude oil was up 1.2% on Friday at $62.66 a barrel.

Russian stock indexes rose. The dollar-denominated RTS index was up 0.8% to 1,361 points. The rouble-based MOEX Russian index was 0.7% higher at 2,722 points.

Shares in Norilsk Nickel, the world's largest palladium and refined nickel producer, touched a record high of 15,218 roubles ($241.64) before retreating to 15,000 roubles, up 1.5% on the day.

Aton brokerage, upgrading Norilsk's shares to "outperform", said that, even at current highs, they remained cheap.

"Russia is highly attractive and Nornickel is likely to be the first company in the metals and mining sector to receive international inflows, we believe," Aton said.